Hong Kong, a Special Administrative Region of the People’s Republic of China, is one of the biggest financial centers of the Asian region. Over the last few decades, Honk Kong has become one of the biggest financial centers around the world thanks to its low taxation and free trade opportunities.
Hong Kong is a city with the highest number of billionaires in Asia, and it also has the largest concentration of ultra-high-net-worth individuals of any city in the world. Hong Kong is regarded to be one of the biggest financial markets around the world, and certainly in Asia. It plays a huge role in the economic life of the whole world, and it should not come as a surprise that it plays such a huge role in Forex trading.
The best Forex brokers in Hong Kong
Finding the best Forex broker is not easy. Traders need to take into account various factors, such as: trading fees, account types, available assets, customer service and trading platforms. To make the selection process easier for you, we’ve reviewed multiple Forex and CFD (Contracts for Difference) brokers and created the best brokers list that accept traders from Hong Kong.
Forex trading regulations in Hong Kong
Forex and CFD trading in Hong Kong is fully legal and highly popular. Currency trading is regulated by the Securities and Futures Commission (SFC). The SFC is responsible for regulating and supervising the financial markets in the country, including Forex.
The primary responsibilities of SFC include:
- Licensing financial institutions. Forex and CFD brokers that operate in the country are obligated to acquire the license. However, residents of Hong Kong can also open trading accounts with international brokers that have international license.
- To obtain a license, SFC requires brokers to have sufficient financial resources to operate. And the amount depends on the type of license and activity conducted by the broker.
- Brokers are required to follow Anti-Money Laundering (AML) and Know Your Customer (KYC) guidelines. In addition, brokers regulated in Honk Kong need to be a part of investor’s compensation scheme.
The Forex brokers licensed by the regulatory body are also required to provide regular monitoring and review to the SFC. These reviews include the ongoing events in the company for the past several months or years and should be provided to the regulatory body in great detail.
The national currency of Hong Kong
The Hong Kong dollar (HKD) is the official currency of Hong Kong. The Hong Kong Monetary Authority (HKMA) is responsible for issuing and regulating currency to keep inflation at a steady level. HKD is considered to be less liquid than major currencies such as USD, EUR, JPY, GBP, CAD, etc. And therefore, it is difficult to day-trade HKD pairs in Forex profitable. In fact, most professional and beginner traders avoid trading less liquid pairs. However, the currency pair can offer trading opportunities for swing and position traders.
Popular Forex trading platforms in Hong Kong
While talking about Forex trading, it is very important to keep in mind the importance of trading platforms. Trading platforms are essential in conducting a technical analysis, they help place various order types, help automate trading and copy trade.
Some Forex and CFD brokers have created custom-built platforms, while others are offering the most popular third party software, such as:
- MetaTrader 4 (MT4) – best for Forex trading, highly reliable and simple to use
- MetaTrader 5 (MT5) – best for multi-asset trading, reliable, however, more complex than MT4
- cTrader – best for trading Forex and available on ECN (Electronic Communication Network) accounts that enjoy raw spreads. cTrader is popular among intraday Forex traders, however, not as popular as MT4.
Summary
Overall, Forex and CFD trading in Hong Kong is very popular and the number of traders increase each year. The local regulator is the Securities and Futures Commission (SFC). However, it’s worth mentioning that there are not many local brokers to choose from, which is why we recommend internationally regulated ones that offer great trading conditions and are highly reputable, such as XM, AvaTrade, EagleFX, and others in our top brokers list.
FAQs on the best Forex brokers in Hong Kong
Can I trade Hong Kong Dollar in Forex?
Is Forex legal in Hong Kong?
